Unions Protest Against Bush's Social Security Proposal

By STEVEN GREENHOUSE

Published: April 1, 2005

The nation's labor unions stepped up their campaign yesterday to stop President Bush's Social Security plan, staging demonstrations in New York, Washington, San Francisco and 70 other cities.

The protests are part of a huge effort that labor has mounted, packing congressmen's town meetings with union members, pressuring investment firms to stop backing Mr. Bush's proposal and collecting tens of thousands of signatures to denounce his call for personal Social Security investment accounts.

''The White House is financing a giant propaganda campaign to convince voters to support privatization,'' John J. Sweeney, the A.F.L.-C.I.O.'s president, said at a rally yesterday in Washington. ''But American voters know privatization is a flim-flam scheme -- they already know that privatization means steep benefit cuts, an exploding deficit, huge bills for our children and grandchildren.''

Labor's efforts have been focused on moderate Republicans, seeking to persuade them not to back Mr. Bush on the issue.

''I think we've probably kept a lot of members from publicly declaring their support for the president's plan,'' said Bill Samuel, the A.F.L.-C.I.O.'s legislative director. ''I think Republicans are showing greater and greater caution about this issue.''

The president's supporters are firing back by accusing unions of using unfair, and possibly illegal, tactics. Representative John A. Boehner, Republican of Ohio, who is chairman of the House Education and the Workforce Committee, has urged the Labor Department to investigate whether labor's tactics violated the ban on secondary boycotts -- boycotts against any party not directly involved in a labor dispute -- and other laws.

''The debate over how to ensure the solvency of Social Security for future generations should be open and honest, but it shouldn't be influenced by special interests who may be breaking federal law,'' Mr. Boehner said in a letter he wrote along with Representative Sam Johnson, Republican of Texas, who heads the House Subcommittee on Employer-Employee Relations.

Picking up on this idea, Derrick Max, president of a group favoring personal accounts, the Coalition for the Modernization and Protection of America's Social Security, said yesterday: ''Union pension trustees are charged with one focus -- the profitability of the funds for their membership. We think using the funds in a political way is a disservice to their members and potentially violates the law by breaching their fiduciary duties.''

''To make the president's plan work, the government will have to borrow $2 trillion in the first decade and $2 trillion in the second decade,'' Mr. Trumka said. ''That will push down the value of bonds, and since union pension funds are invested heavily in bonds, the president's plan will hurt union pension funds and endanger members' benefits.''

Damon Silvers, the A.F.L.-C.I.O.'s associate general counsel, said the demonstrations did not violate the ban on secondary boycotts, since that involves job actions like strikes, while the Social Security protests concerned a public policy dispute.

Mr. Silvers called Mr. Boehner's letter ''an effort to enlist the Department of Labor in a punitive expedition designed to prevent workers and their unions from exercising their First Amendment rights.''

Many of the demonstrations yesterday focused on the Charles Schwab Corporation, the investment firm. The unions said Schwab should stop supporting Mr. Bush's proposal and should drop out of a pro-privatization group, the Alliance for Worker Retirement Security. Unions have already pressured two financial firms, Edward Jones and Waddell & Reed, into quitting a group that favors the Bush plan.

At a protest outside the Ritz-Carlton hotel in New York's financial district, where Charles R. Schwab, the company's chairman, was attending a luncheon, Bruce Raynor, president of Unite Here, said, ''We're telling the titans of Wall Street to keep their hands off of Social Security.''

Greg Gable, a Schwab spokesman, said, the company was not taking sides in the Social Security debate. ''We feel that targeting us in these protests is misdirected,'' he said.

As part of their Social Security campaign, unions have assigned 36 staff employees to work in 21 states. Labor delegations have met with 90 members of Congress, and shop stewards have distributed tens of thousands of fliers to workers.

Representative John M. McHugh, a moderate Republican from upstate New York who has met with labor leaders, said, ''They're right about their concerns about the cost of the plan and the fact that it doesn't fix the problem.''

Representative Sherwood Boehlert, another Republican from upstate New York, said he had met three times with union leaders about Social Security. ''I told them what I told the president: Count me as being skeptical about the plan,'' he said.

Republican leaders voiced strong dismay with labor's efforts.

Tracey Schmitt, press secretary for the Republican National Committee, said: ''Today's theatrics once again reveal that many labor unions are more concerned with partisan politics than the interests of their own members. Recent activities to intimidate organizations that support the president's Social Security efforts amount to thuggery and do nothing to encourage public discourse.''

Photos: John J. Sweeney, president of the A.F.L.-C.I.O., spoke in front of Charles Schwab offices in Washington. (Photo by Ken Cedeno for The New York Times); Union members protested in San Francisco and more than other 70 cities against changing Social Security. (Photo by Jim Wilson/The New York Times)